Private sector life insurer SBI Life Insurance has reported a 43 per cent drop in net profit in the June quarter due to higher Covid reserves set aside for future claims. In Q1FY22, the insurer posted a net profit of Rs 223 crore against Rs 390.89 crore in Q1FY21.
It has set aside Rs 444.72 crore as Covid reserves during the June quarter. However, it has said that it will closely monitor any future developments relating to covid-19 which may impact its business and financial position.
The insurer's claims rose 1.28x by volume from FY21 to Q1FY22. In Q1, it has settled 8,956 covid claims, amounting to Rs 570 crore (net of reinsurance).
Value of new business of the insurer in the June quarter grew by 45 per cent to Rs 340 crore as against Rs 240 crore in the year-ago period. And, the new business margin was up 250 basis points (bps) year-on-year (YoY) to 21.2 per cent.
Its gross written premium was up 10 per cent YoY to Rs 8,380 crore in Q1FY21, with renewal premium up 1o per cent to Rs 5,030 crore, and new business premium up 9 per cent to Rs 3,350 crore.
The annualised premium equivalent (APE) of the insurer in Q1FY21 stood at Rs 1,620 crore, up 27 per cent YoY from 1,270 crore. APE is the sum of annualised first-year premiums on regular premium policies, and 10 per cent of single premiums, written by the company during the fiscal year from both retail and group customers.
Assets under management of the insurer grew 32 per cent YoY to Rs 2.31 trillion at the end of the June quarter.
As far as persistency is concerned, which is the proportion of policyholders who continue to pay their renewal premium, the insurer saw a 295 basis points growth in 13th-month persistency to 84.5 per cent. Further, 61st-month persistency for Q1 FY 2022 stood at 60.88 per cent.
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